Monthly Archives: August 2016

What was once a failed Trump-branded project on prime beachfront land appeared to be saved when a new developer swooped in three years ago with a grand plan.

But the fate of the Conrad Fort Lauderdale Beach now seems to be up in the air again, with the condo-hotel facing months of delays, a construction lien from its general contractor and an opening date that hinges on a yet-to-close refinancing deal.

Orchestra Hotels + Resorts, led by Andreas Ioannou and Jose Luis Zapata, bought out the languishing project at 551 North Fort Lauderdale Beach Boulevard for $115 million in 2013.

At the time, Orchestra’s plans were to spend $40 million on finishing and revamping the building into a modern tower with 290 units, split between 109 condos – dubbed the Ocean Resort Residences – and 181 condo-hotel units.

Hilton Worldwide’s Conrad Hotels and Resorts brand was also brought on to head the property’s leisure services and manage the condo-hotel units.

Fast forward three years, and those plans have changed. Ioannou told The Real Deal that the project’s budget is now closer to $70 million, with the extra expenditures going toward upgrading the building’s public areas to better compete with nearby upcoming luxury projects like Auberge Fort Lauderdale and the Four Seasons Hotel and Private Residences.

“We felt we had to do more to make sure we lead the market,” he said. “That has led to delays.”

Orchestra originally slated the Conrad to open in early 2015, though that date was pushed back several times and is still uncertain.

Ioannou said the opening hinges on refinancing Orchestra’s construction loan with a better interest rate – a deal he said should close within the next two weeks. Once the loan is in place, Hilton’s management team can begin the three-to-four month process of getting the hotel ready for opening.

In the meantime, the building’s units will sit untouched despite receiving a full certificate of occupancy from city officials in June. Ioannou said condo owners are allowed by law to occupy the condos, but without furnishings or a functioning hotel, there would be little point.

And according to Broward County records, the developer is now facing a $1.4 million construction lien from its general contractor, Moss & Associates. The firm declined to comment, but Ioannou said he can’t close any condo purchases until the lien is lifted. About 35 percent of the project has been sold, and Ioannou said roughly half of those deals have closed.

County records show closings began as early as 2014, meaning buyers at the project have waited years for the project to open. Meanwhile, Ioannou said, the development team has committed to covering property taxes and “share fees” for all units until the hotel opens.

Though Ioannou was optimistic that the project would move forward as intended, others familiar with the development said the warning light is blinking.

Philip Gutman, vice president of sales at Douglas Elliman’s development marketing division, said his firm and the developer parted ways after less than a year in 2014.

“I think the project was designed in an era that the condo-hotel model with smaller units worked,” Gutman told TRD. “We had some suggestions but [the developer] didn’t really work off of them, and finally Cervera took over when we left.”

Sales are now being handled by Cervera Real Estate, with prices starting in the $400,000s and ranging to more than $1 million.

It’s not unusual for projects to cycle through marketing firms during development, but Gutman said it was his firm that decided to cut the cord. Peggy Fucci’s brokerage One World Properties also headed sales at the Conrad for a brief period when the project first launched.

Over budget and delayed, Orchestra is now finding itself in a situation similar to the one that led the former owners to abandon the project. Formerly known as the Trump International Hotel & Tower, the project originally launched in 2004 with Roy Stillman’s SB Hotel Associates as the developer and a licensing agreement from Donald Trump.

But construction was halted amid a litigation firestorm between buyers looking to get their deposits back from a sinking ship and the developer, who ran out of financing before finishing.

The situation was messy: court documents reveal complaints from buyers who felt they were misled by marketing materials into thinking Trump was the developer. Trump fired off another suit at Stillman for an alleged breach of contract, stating he costed Trump millions of dollars and damaged his reputation.

When asked if Orchestra would sell the development, Iannou said, “That is not part of our business plan, though you should never say no if someone comes in and wants to spend a lot of money. Our objective is to keep the hotel for years to come.”

The 2016 recreational red snapper season in Gulf of Mexico state waters (shore to 9 nautical miles) will reopen September 2nd and remain open Fridays, Saturdays and Sundays in September and October, and on Labor Day.

The reopening of red snapper state season for Labor Day weekend and weekends in September and October will give anglers additional fishing opportunities in the fall. The daily bag limit is two fish per person within the 10-snapper aggregate bag limit. The minimum size limit is 16 inches total length.

The private recreational angler red snapper season in Gulf federal waters was June 1-9 and was extended two days due to Tropical Storm Colin, closing June 12. The federally-permitted charter boat and head boat season for federal waters ran June 1 to July 16 (closing July 17). The federal red snapper season will remain closed during the September-October state season.

Learn more about red snapper at MyFWC.com/Fishing by clicking on “Saltwater Fishing,” “Recreational Regulations” and “Snappers” (under “Reef Fish”).

The parking woes at Harvey Hernandez’s BrickellHouse project are about to get worse, according to an attorney representing the building’s unit owners.

“The condo association has been left with this mess,” lawyer Helio de la Torre told The Real Deal. “We have to clean up this mess.”

On Aug. 23, de la Torre’s client, BrickellHouse Condominium Association, filed an amended lawsuit against Hernandez, his company BrickellHouse Holding LLC and Hartford Steam Boiler Inspection and Insurance Company, seeking additional damages for the possibility that some condo owners may be left without a parking space if the building’s troublesome robotic parking garage is replaced with a new system.

The association initially sued the developer in January and amended its complaint three times in March to add more counts regarding the failure of the the 374-unit building’s robotic parking garage. Court documents allege buyers were promised South Florida’s first fully automated parking system that would deliver their vehicles in and out of the building without drivers inside the cars.

Instead, the system was rife with problems such as operating so slowly that sometimes it too more than two hours to retrieve cars, the lawsuit alleges. The condo association also alleged that the system would often stall and malfunction and would only work properly under constant staff supervision. Boomerang Systems, the company that made the system, filed for Chapter 11 bankruptcy and its contract with the condo association to operate the garage was terminated by a judge.

In the latest development, de la Torre told TRD that BrickellHouse‘s garage was supposedly built to hold 480 vehicles. However, the association is looking to replace the Boomerang system with a different system from another vendor, de la Torre said.

“At this point, we know that any replacement may result in less than 480 vehicles,” he said. “That means we have to face a situation where certain owners will be directly impacted. There are going to be tough choices to make.”

Ronald Lowy, an attorney representing Hernandez, said the association is making a mistake by trying to replace the Boomerang system instead of fixing it. He said the problem lies with the proprietary software the company installed to operate the garage.

“The software needs to be adapted by somebody else,” he said. “Either you pay the bankruptcy trustee for their proprietary use of the Boomerang software or you have to create separate software to make it operate effectively.”

Lowy insisted there are no construction defects in the garage. “There is not a thing wrong with the garage,” Lowy said. “They are seeking to recreate it by starting from scratch, which is an unnecessary expense. No one is going to offer them a cheap fix and they are refusing to allow us to fix it.”

The 2016 recreational red snapper season in Gulf of Mexico state waters (shore to 9 nautical miles) will reopen September 2nd and remain open Fridays, Saturdays and Sundays in September and October, and on Labor Day.

The reopening of red snapper state season for Labor Day weekend and weekends in September and October will give anglers additional fishing opportunities in the fall. The daily bag limit is two fish per person within the 10-snapper aggregate bag limit. The minimum size limit is 16 inches total length.

The private recreational angler red snapper season in Gulf federal waters was June 1-9 and was extended two days due to Tropical Storm Colin, closing June 12. The federally-permitted charter boat and head boat season for federal waters ran June 1 to July 16 (closing July 17). The federal red snapper season will remain closed during the September-October state season.

Learn more about red snapper at MyFWC.com/Fishing by clicking on “Saltwater Fishing,” “Recreational Regulations” and “Snappers” (under “Reef Fish”).

An investigation by the New York Times contends that Trump Management consistently turned away black tenants and other minorities from its rental properties, dating back to the 1960s. There was no evidence that Donald Trump helped set the organization’s rental policies, just that he was working for the company while they were in place. The Republican presidential candidate – who has warned black voters that Hilary Clinton is a “bigot” – has denied knowledge of any discriminatory practices at Trump-owned properties.

The Justice Department sued Donald Trump and his father Fred, the company’s chairman, in 1973 for allegedly violating the Fair Housing Act by discriminating against blacks at their properties. Ultimately, the Trumps signed a consent decree, a settlement that Donald later touted in “Art of the Deal” for having admitted to no wrongdoing.

At the time, Thomas Miranda, a former superintendent for Trump Management, testified that several company employees instructed him to label apartment applications from black individuals with a “C” for “colored.”

This case was Trump’s first major run-in with the legal system, and many other cases followed. In April, The Real Deal identified more than 90 cases in which Trump or one of his entities sued in New York County State Supreme Court on a real estate-related matter and more than 250 cases in which he or one of his entities was the one being was sued.

The Times noted there’s no suggestion of racial bias by Donald Trump toward prospective residents in Manhattan luxury properties since the 1980s. [NYT] – Kathryn Brenzel

The recreational harvest season for snook starts September 1st statewide. Unique to the region, snook are one of the many reasons Florida is the Fishing Capital of the World.

The Florida Fish and Wildlife Conservation Commission (FWC) encourages anglers to continue to use moderation when determining whether or not to take a snook home. Gulf snook populations were negatively impacted by a 2010 cold kill. Gulf snook numbers currently exceed FWC management goals, but are still rebuilding to pre-cold kill levels, which is one of the reasons why it is important to handle fish with care and use moderation when determining whether or not to harvest one.

During the open season, the daily bag limit is one fish per person. In the Atlantic, snook must be not less than 28 inches and not more than 32 inches total length, which is measured from the most forward point of the head with the mouth closed to the farthest tip of the tail with the tail compressed or squeezed while the fish is lying on its side. In the Gulf, they must be not less than 28 inches and not more than 33 inches total length.

When releasing a snook, proper handling methods can help ensure your fish’s survival and the species’ abundance for anglers today and generations to come. To learn more about catch-and-release and the best way to handle a fish, visit MyFWC.com/Fishing and click on “Saltwater Fishing,” then “Recreational Regulations” and “Fish Handling.”

A snook permit, as well as a recreational saltwater license, is required unless the angler is exempt from the recreational license requirements. Snook may be targeted or harvested with hook and line gear only. Snagging is prohibited.

Snook are closed to harvest Dec. 1 through the end of February and May 1 through Aug. 31 in Gulf state and federal waters, including Monroe County and Everglades National Park. In Atlantic state and federal waters, including Lake Okeechobee and the Kissimmee River, snook is closed Dec. 15 through Jan. 31 and June 1 through Aug. 31.

Researchers ask anglers who harvest the fish to save their filleted carcasses and provide them to the FWC by dropping them off at a participating bait and tackle store. For the county-by-county list, go to MyFWC.com/Research and click on “Saltwater,” then “Snook” (under “Saltwater Fish”) and “Snook Anglers Asked to Help with Research.”

These carcasses provide biological data, including the size, age, maturity and sex of the catch. This information is important to the FWC in completing stock assessments. If you see a snook fishery violation, call the Wildlife Alert Program at 888-404-FWCC (3922).